Lending Technologies, Bank Size, and Small Business Finance: Extensions and Tests of the Current Paradigm

2007 ◽  
Author(s):  
Allen N. Berger ◽  
Lamont K. Black
Keyword(s):  
Small Business ◽  
Small Business Finance ◽  
Current Paradigm ◽  
Lending Technologies

scholarly journals Determinants of Small Business Owner Loan

2019 ◽  
Vol 3 (2) ◽  
pp. 8
Author(s):  
Jiameng Ma
Keyword(s):  
Small Business ◽  
Small Businesses ◽  
The United States ◽  
Agency Cost ◽  
Cost Of Debt ◽  
Business Owner ◽  
Small Business Owner ◽  
Small Business Finance ◽  
United States Economy ◽  
Agency Cost Of Debt

Shareholders and debtholders have diverging objectives. Shareholders are residual claimants whereas debtholders are fxed claimants to frm’s assets. In leveraged frms, shareholders may increase the value of their claims at the expense of debtholders. The presence of shareholders being debtholders is a smart interest alignment, providing a solution to shareholder-debtholder conflicts. This paper focuses on small businesses, which play an important role in the United States economy but are generally neglected by academia. Utilizing National Survey of Small Business Finance (NSSBF) data, this paper shows that frms with higher agency cost of debt are more likely to issue owner loan. The incidence of small business owner loan is positively associated with external lending diffculty, low shareholder agency cost and frm valuation diffculty.

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